New Delhi: The minister of petroleum and natural gas, Mani Shankar Aiyar, has informed the Rajya Sabha that production of oil and gas from Sakhalin-I is expected to commence from 2005-06 and full production is expected from the last quarter of 2006-07.

ONGC Videsh Ltd's (OVL) would have a share of 20 per cent from the oil and gas production in the Sakhalin Project. It is expected to yield about 12.5 million tonne of oil and 10 billion cubic metre of gas in the year at peak production.

The total production of the fields over their 40-year life period is estimated to be about 307 million tonne of oil and 485 billion cubic meter of gas. OVL has the option to bring its share of oil and gas to India or sell it outside the country at the prevailing market prices.

In addition to OVL's partnership with Rosneft in Sakhalin-I project in Russia, Aiyar said that further discussions about possible areas of collaboration have been held at the ministerial, official and commercial levels on this subject and the response has been encouraging.

Saudi Aramco, the world's largest oil company, is keen to partner with state-owned Indian Oil Corporation (IOC) in mainting strategic crude reserves, Aiyar said. In a recent meeting between IOC and Saudi Aramco, the latter had expressed interest in joining India's efforts for maintenance of 'strategic petroleum reserves', though no formal proposal had been received from Saudi Aramco, he stated.

India is in the process of building 5 million tonnes of storage capacity for crude oil in Visakhapatnam and Mangalore to improve its energy security. The storage, equivalent to 15 days of the country's oil requirement, would boost India's existing 7.3 million tonne of crude tankage and 6.8 million tonnes product tankage capacity.

Currently, total crude oil storage capacity can meet the country's oil requirement for 19 days.